Capitol Alert

California cigarette tax backers commit $2 million

Proposed ballot initiatives in California would impose a $2-per-pack tax on cigarettes to help fund Medi-Cal.
Proposed ballot initiatives in California would impose a $2-per-pack tax on cigarettes to help fund Medi-Cal. The Associated Press file

Hoping to influence a special health care budget session, a coalition of labor and medical groups has put $2 million into an initiative to raise California’s tobacco tax and use the revenue to fund health care for low-income Californians.

The money flowed from a coalition of groups that include SEIU California State Council – a union umbrella group whose members include thousands of health care workers – the California Medical Association, the California Dental Association, the American Cancer Society and groups promoting heart and lung health.

Their twin ballot initiatives would impose a $2-per-pack tax on cigarettes to fund health programs that include smoking prevention and Medi-Cal, California’s health insurance program for low-income residents.

The money is another move in an ongoing political fight over Medi-Cal reimbursement rates.

The money is another move in an ongoing political fight over Medi-Cal reimbursement rates.

A similar coalition of medical and labor groups has pushed to have California increase how much it pays doctors and other providers, saying existing rates are making it hard to obtain health care. Some of the cigarette tax revenue would flow into a new fund that could be used to augment Medi-Cal provider rates.

“We are serious about increasing these rates and improving access and keeping California healthy,” said Laphonza Butler, president of SEIU California.

Proponents have yet to decide which ballot measure they would pursue – one of the two would tax electronic cigarettes – but they will be able to begin collecting signatures soon.

A Senate bill to boost the tax cleared committees but still awaits a floor vote, a dubious proposition given that it would need votes from Republicans unlikely to back a new tax. Outside groups often float ballot initiatives as a way to pressure legislators: pass the bill or we will go directly to voters.

“We strongly support securing a legislative remedy that’s in the best interest of Californians, but we are ready and willing to go to the ballot if necessary,” said Mike Roth, a spokesman for the campaign.

The $2 million announcement coincides with Gov. Jerry Brown convening lawmakers for a special budget session to deal with Medi-Cal’s finances. It is “yet to be determined” if an agreement to raise reimbursement rates would lead the coalition to drop the tobacco tax initiatives, Roth said.

Advocates have lost the tax fight at the ballot before, in 2006 and most recently in 2012, after being vastly outspent by a tobacco industry intent on defeating Proposition 29.

Tobacco companies donated tens of thousands of dollars directly to lawmakers last election cycle. The Legislature is considering a number of tobacco-related bills this year: one would raise the age to purchase tobacco to 21; one would treat e-cigarettes like conventional cigarettes; and another would ban major-league baseball players from chewing tobacco at California ballparks.

Jeremy B. White: (916) 326-5543, @CapitolAlert

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